Question: How prevalent has the agency problem been in corporate America during the last decade? During the late 1990s, there was a boom in initial public offerings of Internet companies (dotcom companies). The boom was supported by sky-high valuations often assigned to Internet start-ups that had no revenues or earnings.

The boom came to an abrupt end in 2001 when the NASDAQ stock market collapsed, losing almost 80% of its value. Who do you think benefited most from this boom: investors (stockholders) in those companies, managers, or investment bankers?